How to Choose the Right Financial Professional for Your Needs in 2024
If you need help with managing your money, investing your savings, planning your retirement, or dealing with your taxes, you may want to seek the advice of a financial professional in 2024. Dealing with money and finances is a stressful chore and most people don’t like to deal with it, however it is necessary to make sure that you are getting ahead in life to start thinking about your finances and getting the best leg up on life. Hence, delegating the task to a professional for a fee is sometimes the best decision you could make, if you don’t have hours upon hours to do the research yourself or time to build up years of knowledge. Finding a professional will be the best decision you have ever made, but who should you see, and what can they do for you?
There are many types of financial professionals, and they have different qualifications, services, and fees. Some of them may have similar or overlapping titles, such as financial planner and financial adviser, which can be confusing and misleading. To help you understand the differences and similarities between them, and to help you choose the right one for your needs, here is a brief overview of some of the most common financial professionals, and when you should see each one.
Financial Planner vs Financial Adviser
These terms are often used interchangeably, but they are not exactly the same. In general, a financial planner is a type of financial adviser or advisor who specializes in creating a comprehensive and long-term plan for your financial goals, such as saving for retirement, buying a home, or funding your children’s education. A financial adviser is a broader term that refers to anyone who provides financial advice or with less scope and focuses on one or two specific areas, which may include investment management, insurance, estate planning, or tax planning. A financial adviser may or may not be a financial planner, depending on their qualifications, services, and scope of practice.
To find a qualified and trustworthy financial planner or adviser you should look for the following credentials and characteristics:
They have a clear and transparent fee structure, and disclose how they are paid, whether by commission, percentage, flat fee, or hourly rate4.
They have no conflicts of interest or affiliations with financial institutions or product providers that may influence their advice or recommendations4.
They have a good reputation and track record, and provide references or testimonials from previous or current clients.
They have a fiduciary duty to act in your best interests, and follow a code of ethics and professional standards.
You should see a financial planner or adviser if you need help with:
Setting and achieving your financial goals
Creating and implementing a financial plan
Managing your investments and portfolio
Choosing and reviewing your insurance policies
Planning your retirement and superannuation
Planning your estate and succession
Minimising your tax liabilities
Mortgage Broker
A mortgage broker is a financial professional who helps you find and apply for a home loan. A mortgage broker acts as an intermediary between you and the lenders, and compares and negotiates the best loan terms and rates for you. A mortgage broker can also help you with the paperwork and documentation, and guide you through the loan process.
To find a qualified and trustworthy mortgage broker, you should look for the following credentials and characteristics:
They have a valid Australian Credit Licence (ACL) or are authorised by an ACL holder to provide credit services to the public.
They have relevant education, training, and experience in the mortgage industry, and hold professional designations or memberships, such as Certificate IV in Finance and Mortgage Broking, Diploma of Finance and Mortgage Broking Management, or membership of the Mortgage and Finance Association of Australia (MFAA) or the Finance Brokers Association of Australia (FBAA).
They have access to a wide range of lenders and loan products, and can offer you unbiased and independent advice and recommendations.
They have a clear and transparent fee structure, and disclose how they are paid, whether by commission from the lender, fee from you, or both.
They have no conflicts of interest or affiliations with lenders or product providers that may influence their advice or recommendations.
They have a good reputation and track record, and provide references or testimonials from previous or current clients.
They have a fiduciary duty to act in your best interests, and follow a code of ethics and professional standards.
You should see a mortgage broker if you need help with:
Finding and applying for a home loan
Comparing and negotiating loan terms and rates
Refinancing or switching your existing loan
Consolidating your debts
Accessing your home equity
Stock Broker
A stock broker is a financial professional who helps you buy and sell shares and other securities on the stock market. A stock broker acts as an agent or a dealer between you and the market, and executes your orders and transactions. A stock broker can also provide you with research, analysis, and advice on the securities and the market.
To find a qualified and trustworthy stock broker, you should look for the following credentials and characteristics:
They have a valid Australian Financial Services Licence (AFSL) or are authorised by an AFSL holder to provide financial services to the public3.
They have relevant education, training, and experience in the stock market, and hold professional designations or memberships, such as Chartered Market Technician (CMT), Certified Financial Technician (CFTe), or membership of the Stockbrokers and Financial Advisers Association (SAFAA) or the Australian Securities and Investments Commission (ASIC) .
They have access to a wide range of securities and markets, and can offer you diversified and tailored solutions.
They have a clear and transparent fee structure, and disclose how they are paid, whether by commission, percentage, flat fee, or hourly rate.
They have no conflicts of interest or affiliations with securities issuers or market makers that may influence their advice or recommendations.
They have a good reputation and track record, and provide references or testimonials from previous or current clients.
They have a fiduciary duty to act in your best interests, and follow a code of ethics and professional standards.
You should see a stock broker if you need help with:
Buying and selling shares and other securities
Building and managing your portfolio
Researching and analysing the securities and the market
Developing and implementing a trading strategy
Minimising your trading costs and risks
Accountant
An accountant is a financial professional who helps you with your accounting, bookkeeping, and taxation needs. An accountant can help you record, report, and analyse your financial transactions and statements, and prepare and lodge your tax returns and other statutory obligations. An accountant can also provide you with advice and guidance on your financial planning, budgeting, and cash flow.
To find a qualified and trustworthy accountant, you should look for the following credentials and characteristics:
They have a valid Tax Agent Licence or are authorised by a Tax Agent Licence holder to provide tax services to the public.
They have relevant education, training, and experience in accounting and taxation, and hold professional designations or memberships, such as Certified Practising Accountant (CPA), Chartered Accountant (CA), or membership of the Institute of Public Accountants (IPA) or the Tax Practitioners Board (TPB) .
They have access to a wide range of accounting and taxation software and tools, and can offer you efficient and accurate solutions.
They have a clear and transparent fee structure, and disclose how they are paid, whether by commission, percentage, flat fee, or hourly rate.
They have no conflicts of interest or affiliations with financial institutions or product providers that may influence their advice or recommendations.
They have a good reputation and track record, and provide references or testimonials from previous or current clients.
They have a fiduciary duty to act in your best interests, and follow a code of ethics and professional standards.
You should see an accountant if you need help with:
Recording and reporting your financial transactions and statements
Preparing and lodging your tax returns and other statutory obligations
Claiming your tax deductions and credits
Planning and managing your tax liabilities and obligations
Optimising your financial planning, budgeting, and cash flow alongside a Financial Planner.
Choosing the right financial professional for your needs can be a challenging and confusing task, but it can also be a rewarding and beneficial one. By understanding the differences and similarities between various financial professionals, such as financial planner, financial adviser, mortgage broker, stock broker, and accountant, and by looking for the relevant credentials and characteristics, you can find the best one for your needs and goals. You can also use online tools and directories to help you search and compare different financial professionals. And of course, you can always seek a second opinion or a referral from a trusted source, such as a friend, family member, or colleague.
Until next time,
Take Back Control
